Tri-City leaders placed on leave

Board to investigate financial practices

PROFILE

Tri-City Healthcare District

Founded: Voters created the public hospital district in 1957. Tri-City Medical Center in Oceanside opened in 1961.

Area: The district encompasses parts of Oceanside, Vista and Carlsbad.

Budget: A $319 million 2008-09 budget anticipates a $9.6 million surplus.

Construction: Expansion and earthquake retrofitting plans are on hold. Two bond measures in 2006 for $596 million and one in August for $589 million failed to receive the required two-thirds voter approval for passage.

CEO: Arthur Gonzalez was put on paid leave yesterday. Gonzalez, hired in 1998, previously was CEO for Schumpert Health System in Louisiana. His base salary is $438,000 a year, plus a $12,000 auto allowance. Additionally, $51,684 is in a deferred compensation account that he is to receive in 2011.

OCEANSIDE 
In a sudden sweep of its top tier of management, the Tri-City Healthcare District board placed its chief executive officer and seven other administrators on paid leave yesterday while it investigates district finances.

The new Tri-City board chairwoman announced that the district has hired Michael Williams, of C.M. de Crinis & Co. in Sherman Oaks, “to conduct a forensic investigation into district finances and operations.”

Williams also was named the district's interim CEO, replacing Dr. Arthur Gonzalez, who has served as chief executive since 1998.

The board met in a closed session Thursday evening and issued a statement at 6:30 p.m. yesterday on the probe and the personnel changes. No board members or administrators would say specifically who or what was being investigated.

The public hospital district takes in most of Oceanside, Vista and Carlsbad and operates Tri-City Medical Center in Oceanside.

The Friday afternoon action was the first official one by a board with two new members, elected in November, who changed the balance of power on a panel divided over Gonzalez's leadership and his commitment to the public's welfare.

It also happened two weeks after the lame-duck board awarded administrators and staff members $2.4 million in bonuses on a 4-2 vote, over vociferous objections by some hospital employees and members of the public.

Gonzalez was given a $90,000 bonus on top of his $438,000 annual salary.

Board members RoseMarie Reno and Kathleen Sterling voted against the bonuses. Members Darlene Garrahy and David Tweedy were among the four who voted for the bonuses. Two days later, Garrahy and Tweedy were replaced by George Coulter and Charlene Anderson, who had defeated them Nov. 4.

The new board also ousted its legal counsel, the law firms Best, Best & Krieger, and Musick, Peeler & Garrett. They were replaced with Julie Biggs of Burke, Williams & Sorensen in Riverside.

Coulter said yesterday that he would not have voted for the bonuses and resented that two ousted board members did so. He said that vote was a factor in his decision to hire a new attorney.

“At that point I decided they were with the administration and not with the people,” Coulter said.

Many rank-and-file employees and members of the public scolded the board before it awarded the bonuses.

“Some of these things don't seem ethical and not even legal,” Coulter said of the vote.

He said he had campaigned on the premise that Gonzalez was not responsive to the public.

“He's either got to change his ways or get on his way,” Coulter said. “We're not getting the transparency that's needed.”

William Howell, one of the administrators placed on leave, said in a telephone interview last night that he was summoned yesterday by Williams, the new CEO, and given a letter that said he was being placed on paid administrative leave.

He said the letter stated, “The purpose of the administrative leave is to offer an opportunity for an investigation surrounding allegations of failure to adequately perform job duties.”

Howell added, “I asked: 'What's the reason for this? What are the charges? What are you looking for?' and they said, 'We can't tell you.' ”

Howell, vice president for performance improvement and strategic planning, said he has been with the district for three years.

He said he was told not to remove, alter or destroy anything on his computer.

“As I understand it, I'm not supposed to go back to the hospital until they've done this investigation,” Howell said. “I'm not particularly happy about this.”

In her statement released late yesterday, Reno, the board chairwoman, listed new acting administrators but didn't say anyone had been placed on leave.

She said the closed-session discussion Thursday considered two legal matters and that Williams was appointed “as a result of that discussion, and the legal strategy determinations that were made.”

Reno said the action was taken “to assure the privacy rights of district employees and to secure the district's assets and records.”